SkyCity deemed ‘suitable’ to hold casino licence in scathing report
A long-awaited report into SkyCity’s suitability to hold SA’s only casino licence has been handed down, with the independent reviewer finding evidence of a “poor and inadequate culture” in the past.
SkyCity Adelaide can continue to hold the Adelaide casino licence according to a new report into the company’s operations and culture, which was released publicly today by the Commissioner for Liquor and Gambling in South Australia.
The report – by retired Supreme Court Judge Brian Martin AO KC – concluded that SkyCity Adelaide is suitable to hold South Australia’s only casino licence, and that the casino’s parent company is “suitable to be a close associate of SkyCity Adelaide”.
However, the report uncovered serious findings against SkyCity, including that there was a “poor and inadequate culture” in the past, that SkyCity “failed to comply with its obligations” and that “there was a complete failure by the Board of the licensee to exercise its powers and functions as a Board of an incorporated entity”.
In a comprehensive 540-page report, Martin details the many failures of SkyCity to comply with its anti-money laundering obligations, as well as “financial issues of significance which have the potential to derail the best intentions and efforts of the licensee”.
Martin goes on to explain that positive progress has been made by SkyCity since mid-2024.
SkyCity is currently implementing the ‘Building a Better Business Programme’ (B3) in conjunction with its independent monitor Kroll Australia.
The company has a goal to complete the program by June 30, 2027, but Martin said: “as at mid-2025 there remains significant uncertainty in that regard”.
“The concept of ‘suitability’ is discussed in detail later in this report,” Martin said.
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“For present purposes, it is sufficient to note that ‘suitable’ does not mean ‘perfect’.”
Martin’s review began in mid-2022 following extensive investigations that were already being progressed by Consumer and Business Services.
The review was put on hold between February 2023 and June 2024 while the financial crimes watchdog took civil action against SkyCity in the Federal Court for breaching anti-money laundering laws.
SkyCity was ordered to pay a $67 million penalty by the Federal Court as a result of AUSTRAC’s case which found SkyCity’s anti-money laundering programs failed to meet the legislative requirements and that it did not carry out appropriate ongoing customer due diligence.
In his report, Martin said: “If I had been asked to determine the suitability of the licensee and SCEG [SkyCity Entertainment Group] at the end of October 2021, the inevitable answer would have been that neither were suitable”.
“Since then, the situation has changed,” Martin said.
He stressed that the “significance of the change in culture and ongoing progress should not be underestimated”.
“I am satisfied that the licensee is genuinely endeavouring to comply with its primary obligations under the regulatory regime and that it will continue to do so in the immediate future under the current monitorship and leadership,” Martin said.
Liquor and Gambling Commissioner Brett Humphrey said the review was “extremely thorough”.
“I accept Mr Martin’s findings that SkyCity Adelaide is suitable to hold and operate the casino licence and SkyCity Entertainment Group is suitable to be SkyCity Adelaide’s close associate,” Humphrey said.
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“But let me be clear, this is by no means a clean bill of health for SkyCity Adelaide.
“Even though many of the issues raised have either been addressed or are being addressed through a program of work being supervised by the independent monitor since August 2023, the deficiencies and breaches uncovered are deeply concerning.”
He said he would consider Martin’s findings alongside ongoing Consumer and Business Services work before deciding on what enforcement action to take.
“I will also be looking at what measures may be required for the ongoing future operations of the licence,” he said.
“In the interests of transparency, I have formed the view that Mr Martin’s report should be made public while I continue the next steps.
“Confidentiality provisions of the Gambling Administration Act 2019 prevented disclosure of the report previously and it is only with SkyCity’s consent that it can now be released.”
Some parts of the report are redacted to protect personal and commercial concerns, but they may be removed in the coming months.
SkyCity said it accepted that the report identified shortcomings, and that it would work cooperatively with the Commissioner and Consumer and Business Services.
CEO Jason Walbridge said: “We fully accept and acknowledge the findings of the report that we did not measure up to the standards required, and we apologise for those failings”.
“We further acknowledge Mr Martin’s findings and the Commissioner’s comments that we still have work to do. We remain committed to our B3 programme and constructive engagement with all our regulators,” Walbridge said.
“We have made significant enhancements in terms of leadership, resourcing and systems, including a commitment to invest approximately $60 million over three years to transform our culture, to uplift our financial crime and host responsibility practices.
“Our team has worked hard to raise our standards, better meet our obligations and improve how we look after our customers.”
Shares in SkyCity Entertainment Group are up 0.56 per cent to $0.90 per share at the time of writing.
